Due Diligence Report Document stage: Draft for consultation Project number: 34304-044 February 2015 NEP: Kathmandu Valley Water Supply Improvement Project (Additional Financing) Small Works Package 01/21 Prepared by the Kathmandu Upatyaka Khanepani Limited, Ministry of Urban Development, Government of Nepal for the Asian Development Bank. This due diligence report is a document of the borrower. The views expressed herein do not necessarily represent those of ADB's Board of Directors, Management, or staff, and may be preliminary in nature. In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.
CONTENTS Page I. PROJECT DESCRIPTION 1 A. Project Description 1 B. Proposed Project Components 1 II. SCOPE OF THIS REPORT 2 III. NFORMATION DISCLOSURE, CONSULTATION, AND PARTICIPATION 3 A. Methodology and Consultation 3 B. Information Disclosure 3 C. Continued Consultation and Participation 3 IV. SOCIOECONOMIC INFORMATION AND PROFILE 4 A. Socioeconomic Profile of Kathmandu Valley 4 V. CONCLUSION 6 LIST OF ANNEXES Annex 1 Photographs 7 Annex 2 Photographs of Project Site 8
I. PROJECT DESCRIPTION A. Project Description 1. The proposed Kathmandu Valley Water Supply Improvement Project 1 additional financing will support the ongoing efforts of the Government of Nepal towards improving the water supply services in Kathmandu Valley. The project will invest in bulk water transmission, water treatment plan capacity, and distribution network improvement systems, and will complement the past and ongoing Asian Development Bank (ADB) projects. 2 The resultant synergy is expected to lead to increased efficiencies, greater improvement in service delivery, and higher impact on health outcomes and quality of life for inhabitants of Kathmandu Valley. 2. Valley is characterized by high urban population growth (5.3% per annum) and a high population density of 2,800 persons per km. 3 The total population of the Kathmandu Valley in 2011 was approximately 2.5 million. Rapid and largely unplanned urban growth, high population density, lack of sustainable water sources, and inadequate past investments in water supply infrastructure have resulted in abysmally poor availability and quality of drinking water. 4 Moreover, poor access to sanitation facilities, improper solid waste management systems, and groundwater and surface water pollution from untreated domestic sewage have caused increased disease incidence, health risks, and associated economic burdens disproportionately impacting the poor and vulnerable. 5 3. This due diligence report is prepared based on detailed design of small works under the project and is prepared instead of a resettlement plan since there is no expected land acquisition or impact on livelihoods related to the implementation of this small works package. The small works is proposed for immediate rehabilitation of water supply infrastructure in the Kathmandu Valley in existing KUKL facilities. It will be implemented by the Project Implementation Directorate (PID) of Kathmandu Upatyaka Khanepani Limited (KUKL), who will address any resettlement impacts, permanent or temporary, during project implementation. B. Proposed Project Components 4. The package includes immediate improvements of water supply services in Kathmandu Valley through augmentation of surface and ground water sources, water quality improvement related works and rehabilitation and improvement of water and sewer networks at the primary, secondary and tertiary level at Pharping Tika Bhairab and Sundarijal and other surface sources. Mainly the rehabilitation works are for treatment plants, maintenance of reservoirs, and fencing of compound walls. The work includes repair of intake, treatment plant and reservoir of Balaju, Boude, Bhandare, Bishnumati, and Shivapuri area. The rehabilitation/repair of sedimentation tank, rapid sand filter, flocculates of Bansbari, Bhaktapur etc. 1 The project was prepared through PPTA 4893-NEP: Preparing the Kathmandu Valley Water Distribution, Sewerage, and Urban Development Project, approved on 13 December 2006. Due to restructuring of ongoing loans, the work of PPTA started in 2009 and final report was submitted in May 2010. 2 Loan 1820-NEP (SF): Melamchi Water Supply Project was approved on 21 December 2000 and became effective on 28 vember 2001. Loans 2058/2059-NEP (SF): Kathmandu Valley Water Services Sector Development Program were approved on 18 December 2003 and became effective on 7 December 2004. 3 Central Bureau of Statistics, Government of Nepal, 2011. 4 A baseline survey done by CRISIL under PPTA 4893-NEP in September 2010 estimates water availability at 20 liters per capita per day (lpcd) and average duration of water supply at 0.4 hours per day. Kathmandu Upatyaka Khaneani Limited (KUKL), the operator, assesses the current availability as 45 lpcd. 5 Vulnerable groups include female-headed households and below poverty line households (According to the NLSS Survey 2011, an individual is considered poor if his/her per capita total annual consumptions is below Rs. 19,261.)
2 II. SCOPE OF THIS REPORT 5. The physical works in this subproject will involve provision of new facilities. A due diligence was conducted to examine the safeguards issues of the proposed facilities in more detail, particularly with respect to the requirements of ADB Safeguard Policy Statement (2009) and requirements, as well as with other national regulation and policies as relevant. This report provides the findings and status of the required land required for the facilities. 6. There are no land acquisition issues in the small works packages. The rehabilitation/repair of treatment plants, maintenance, improving of sources, fencing of compounds, construction of guard house, and construction of tanker platform are done within the existing facilities of KUKL. The improvement and rehabilitation works are done within the existing land owned by KUKL. Impacts in livelihood and income are not identified during the construction period. So the implementation of small works package does not require land and does not have an impact on livelihoods. The sub project activities and status of resettlement impacts are mentioned in Table 1. Table 1 Sub Project Activities and Resettlement Impacts Work Location Activities IR Impacts Within the existing facility of Balaju RVT area a. Rehabilitation of Treatment Plant ( Balaju Area) Repairing of settling tank, filter basin, circular reservoir tank and construction of boundary wall etc. b. Intake shifting ( Boude- Bhandare) Within the existing facility of KUKL Boude area New intake, collection chamber, guard house, boundary wall etc. c. Intake shifting ( Bishnumati Area) d. Rehabilitation of Treatment Plant ( Mahankalchaur RVT Area) e. Rehabilitation of Treatment Plant ( Sundarijal Area) KUKL Bishnumati area Mahankal RVT station KUKL Sundarijal site Rehabilitation of intake, guard house, new intake chamber fitting etc. Rehabilitation of circular reservoir tank Rehabilitation & maintenance of intake treatment plant & apron etc. f. Construction of tanker platform Mahankal branch Concreting tanker platform, sign board g. Rehabilitation of Treatment KUKL Sundarighat site Stone masonry wall, cleaning Plant ( Sundarighat Area) sedimentation tank, & slow sand h. Pipeline laying & improving ( Khokana & Pharping Area) i. Rehabilitation of Treatment Plant (Bansbari-Panipokhari Area) j. Pipeline laying & improvement ( Chapagoun & Tika Bhairab Area) k. Pipeline laying ( Thimi Tigeni Area) Khokana Bhaktapur filter etc. Laying 2400 m pipe ( public roads) Pipe lying 1600 m, guard house & boundary wall etc. Chapagoun and Pipe lying 2700 m, boundary wall Tikabhairab Bhaktapur Pipe lying 1500 m, new tank 1200 cu.m.
3 III. NFORMATION DISCLOSURE, CONSULTATION, AND PARTICIPATION A. Methodology and Consultation 7. Field verification was carried out covering all proposed works located in different stations of the valley. The site visits were carried out during the first week of December 2014. The field verification was assisted by KUKL branch officials and design team using topographic and land use maps prepared by design team. The consultation meeting were held with key personnel of KUKL branch office. The information was disseminated during the consultative meeting. A consultation program with key stakeholders was carried out, in line with the requirements pertaining to environment and social considerations of ADB. The tools used for consultations were stakeholder meetings and focus group discussions (FGD). These consultations provided the project benefits and potential impacts during the project construction period. Table 2 provides the date, location and details of public consultations. Table.2 Summary of Public Consultations S.N. Date Location Participants Discussion 1 Dec. 05, Balaju RVT area Branch manager, other Project activities, construction time, 2014 staffs possible impacts and mitigation 2 Dec. 05, Boude intake Area Balaju branch manager, and Construction works, benefits, 2014 other staffs possible impacts and quality of works 3 Dec. 05, Bishnumati Area Balaju Branch manager local Possible impacts, benefits and 2014 people construction works 4 Dec. Shivapuri Area Balaju Branch Manager, Technical part of construction 05,2014 5 Dec. 06, Mahankalchour Staffs from branch Technical issues of works 2014 Branch 6 Dec. 06, Sundarijal Branch Manager from Project activities and possible 2014 Mahankal, impacts and benefits 7 Dec. 07, 2014 B. Information Disclosure Sundarighat Branch Manager Tripureshwor, local people Construction activities and possible benefits 8. To provide for more transparency in planning and for further active involvement of affected people and other stakeholders, project information was disseminated through disclosure of the translated versions of the resettlement planning documents. The information was made available at public places, including the offices of PID, KUKL s main office and branch offices, contractor site office, and Ward Office of Kathmandu Metropolitan city. A copy of this Due Diligence Report will be disclosed on the ADB and project related websites, and is also available from PID upon request. C. Continued Consultation and Participation 9. The PID will extend and expand the consultation and disclosure will be continued during construction period of the project. CAPC has been recruited under the original project to ensure ongoing consultations and public awareness during project implementation. DSC recruited under the additional financing will also have social safeguards specialists to support PID with
4 safeguards compliance and consultations. This has been coordinated with the PID, design and supervision consultant (DSC), and contractors to ensure that communities are made fully aware of project activities in all stages of construction. A community awareness and participation plan was also prepared for the project and implementing by CAPC (Loan 2776) and DSC (AF) in coordination with the PID and DSC safeguards expert. Community groups such as TLO and vendor associations have been consulted and made aware of the civil works and project activities prior to construction. IV. SOCIOECONOMIC INFORMATION AND PROFILE A. Socioeconomic Profile of Kathmandu Valley 10. The Kathmandu Valley includes the three districts of Kathmandu, Lalitpur, and Bhaktapur. These include 1 metropolitan city, 1 sub-metropolitan, 3 municipalities, of KUKL service area. Kathmandu Metropolitan area has the highest population and number of households, followed by Lalitpur sub-metropolitan, Madhyapurthimi, Kirtipur and Bhaktapur municipalities as given in the Table : 3 Metro/Sub-metro/ Municipality and VDCs covered Table 3: Household Profile in Kathmandu Valley Population Total Male Female Total househo lds Average size of household s Literac y rate Kathmandu Metro 511,841 463,612 975,453 254,292 3.8 88.52 Kirtipur Municipality 36,476 29,126 65,602 19,441 3.4 86.8 Lalitpur Sub- Metro 113,781 107,021 220,802 54,581 4.0 87.37 Bhaktapur Municipality 41,081 40,667 81,748 17,693 4.6 81.21 Madhyapur Thimi Municipality 42,723 40,313 83,036 20,302 4.1 83.84 Total 745,902 680,739 1,426,641 366,309 3.9 VDC = Village Development Council. Source: Compiled from Census 2011, Central Bureau of Statistics. 11. Social classification. According to a 2011 census, the majority of the people living in the valley are Hindus (80%), followed by Buddhists (15%). The percentage of other religions living in the valley is minimal. The households are divided into different ethnic groups, such as Newar, Brahmin, Chettri, Tamang, and Magar. Newar are the prominent inhabitants, followed by Brahmin, Chettri, Tamang, and Magar. These ethnic groups are not at the same level of socioeconomic development. In the Kathmandu Valley, Newar are considered an advanced indigenous people group. This group comprises about 40% of the valley population. Besides Newar, Brahmin (17%) and Chhetri (20%) are the major ethnic groups. Similarly, Tamang constitute about 7% and Magar hold 3% of the total population of the valley. 12. Age. The economically active age group between 15 and 59 years constitutes about 71% of the valley population. The other main age group is between 0 and 14 years. Only about 7% of the population are over 60 years old. There are no significant differences in the percentage of age distribution in KUKL service areas.
5 13. Health. The number of health facilities owned by the government or provided by nongovernmental organizations (NGOs) and the private sector is relatively better in Kathmandu than in other districts. More health institutions are available in Kathmandu than in Lalitpur and Bhaktapur district. However, the population served by the number of health institutions (hospital, PHCC/HC, HP, SHP, PHC outreach clinic, EPI clinic, NGO/INGO and FCHV) in Kathmandu is less (ratio is 1:951) than in Lalitpur (1:739) and Bhaktapur (1:703). It shows that the number of health institutions is low in comparison to the size of the population in Kathmandu. 14. Education. The Kathmandu Valley has long been considered the centre for higher education in Nepal. In 2011, there were 6,783 Pri Primary to Secondary School level and 438 higher secondary to college level education institutions. The number of students enrolled during the period at the high school and higher education levels in Kathmandu Valley were 1,276,318 and 582,786 respectively (s-cbs-2011and District &VDC profile of Nepal 2014/15). 15. Employment. The economy of the Kathmandu Valley is based on trade, commerce, and manufacturing industries like carpets and garments. Other economic sectors are foreign employment, agriculture, education, transport, hotels, and restaurants. Tourism is also a key component of the valley s economy. However, in the rural areas, the economy is still based on agriculture. 16. Economically active population. About 78% of the total population in the valley aged 15 and above are economically active (Census 2011). Majority of the population of the Kathmandu Valley are engaged in agriculture. The other major industries are manufacturing (24%), trade (42.6%), service (28.6%) and others (4.7%) (Source-NLSS statistical report vol- 2.2/2011). 17. Poverty. According to the 2001 census and the Nepal Human Development Report 2004, the poverty status of the Kathmandu Valley is lower than the national level. Table 4 indicates the human development index in the Kathmandu Valley compared with the national values. Districts Table 4: Kathmandu Valley Development Indicators Human Development Human Poverty Gender-related Index (HDI) Index (HPI) Development Index (GDI) All Nepal 0.458 31.12 0.534 Kathmandu 0.666 22.45 0.635 * Lalitpur 0.640 19.18 0.569 * Bhakltapur 0.618 19.43 0.578 * GDI = Gender-related Development Index, HDI = Human Development Index, HPI = Human Poverty Index. Source: Census 2011, Nepal Human Development Report by UNDP 2014.*HDR/UNDP2004. 18. Slums and squatter settlements. The rapid population growth has created a number of slums and squatter settlements in the Kathmandu Valley. A survey conducted by LICSU, KUKL in 2008 identified that there were 39 squatter settlements and 137 slums in the Kathmandu Valley, where a population of 40,237 live in 8,846 households. Of these, 22% had no access to piped water supply, and none had adequate sanitation. 19. Project Benefits The project will support the delivery of much-needed water to Kathmandu and its surroundings. The project will support KUKL in expanding water services in
6 its service area, where affected businesses are among the beneficiaries. Moreover, the project will employ local people during implementation. V. CONCLUSION 20. It is concluded from this due diligence study that: a) if the locations of proposed facilities to be constructed under the subproject do not change substantially; and b) if the information provided by the KVWSDB and others regarding land ownership and other issues is correct; then there should be no issues of land acquisition and resettlement related to this component. 21. All reservoir facilities will be built on lands that already acquired for the same purpose, which is owned by KVWSDB; and all proposed transmission pipes will be installed in government owned RoW alongside roads, which based on the recent assessment should not cause any loss of income or assets. 22. To ensure all involuntary resettlement impacts are avoided: (i) (ii) A clause will be added in construction contracts requiring contractors to provide wooden/metal walkways across pipe trenches to maintain access to roadside businesses/residential building, with clear signage to prevent accidents. Advance notification of civil works to the affected communities and other mitigation activities as required by EMP is fully implemented.
Annex 1: Photographs Annex 1 7
8 Annex 2 Annex 2: Photographs of Project Site
Annex 2 9